THE SOURCE BLOG

Cost Containment

Happy November! We hope you are enjoying football season and preparing for turkey! In this edition of the Source Roundup, we cover five academic articles and reports from October. The topics this month include (1) the popularity of telemedicine for employers and employees, (2) an integrated health care system that combines ACO and bundled payment, (3) health spending growth in the coming years, (4) Maryland’s new initiative reduced hospital utilization and costs, and (5) how to remedy recent generic drug price hikes. Telemedicine Is More Widely Available, But Take-up …

Welcome to October! We hope you are getting your costumes picked out and finding those deals to stock up on trick-or-treat candy. In this edition of The Source Roundup, we review five academic articles and reports from September that stood out to us. This month we look at (1) price inflation in the California fully-insured large group market, (2) forward motion in drug price transparency laws, (3) the future of pharmaceutical reference pricing in the U.S., (4) lessons learned from California’s competitive healthcare model, and (5) paths to universal coverage …

Year two of California’s 2017-2018 legislative session has been an active one. As lawmakers work diligently, The Source will take a brief look at some 2018 bills that can potentially change the California healthcare landscape. SB 1021: This bill removes the sunset provision for AB 339 (2015), which was enacted to cap cost sharing for a covered outpatient prescription drug at $250/$500 per 30-day supply.[1] Furthermore, the bill codifies the regulation that “prohibits an enrollee or insured from being charged more than the retail price for a prescription drug …

In most markets, consumers can compare prices and shop for the items they want. For example, to buy a new pair of shoes, a consumer can typically drive to a shopping mall and choose from a number of stores. Each store typically carries a number of different styles and brands. The consumer might choose to pay $500 for a designer pair of heels or $25 for an inexpensive pair of tennis shoes. The consumer can also shop online and have the shoes shipped to his or her home. Regardless of …

Happy June! In this edition of the Source Roundup, we cover five academic articles and reports from April and May. The topics this month include: 1) barriers for generics to lower specialty drug prices, 2) a call to reform pharmaceutical systems in the United States and Canada, 3) efforts by states to stabilize the individual market, 4) Vermont’s push for community-driven health care reform, and 5) antitrust lawsuits in the pharmaceutical industry. Barriers for Generics to Lower Specialty Drug Prices The Health Affairs article Generic Price Competition For Specialty Drugs: …

On May 11, 2018, the Trump Administration released American Patients First, a blueprint to lower drug costs (the blueprint). The report details four challenges with the prescription drug market, including high list prices for drugs, high and rising out-of-pocket costs for patients, government programs that overpay for drugs due to the lack of negotiation tools, and foreign governments “free-riding” off of American investment in innovation. To address these challenges, the report also lays out four key strategies for reform, including a list of more than fifty recommendations with both immediate and …

As year two of the California legislative session goes into full swing, a couple of bills introduced in 2017 are still active and waiting to be passed. This month’s post will look at four active 2017 bills that should be considered for passage. SB 199: This bill authorizes the creation of an advisory committee to research and develop recommendations on the creation of a database to be titled California Health Care Cost, Quality, and Equity Atlas. This bill is the first step to creating a statewide database that would collect …

Several major court decisions were handed down last month that may leave lasting impacts in terms of price and competition in the healthcare industry. Specifically, the 4thCircuit Court of Appeals ruled Maryland’s Price Gouging Law unconstitutional, while the Supreme Court upheld inter partes review, a controversial patent review process. In antitrust enforcement, the Justice Department began its review of the Cigna-Express Scripts merger. 4thCircuit Strikes Down Maryland Price Gouging Law In a significant victory for the pharmaceutical industry, the 4thU.S. Circuit Court of Appeals found Maryland’s landmark 2017 law, …

Rising prescription drug prices concern nearly all Americans, with 80% reporting that drug prices are “unreasonable”. The problem of rising drug expenditures is particularly acute for state Medicaid programs, which provide health coverage for low-income and disabled Americans. Medicaid serves nearly one in five Americans including many with chronic conditions, and purchases about 10% of total prescription medications dispensed in the U.S.[1] Furthermore, Medicaid’s nationwide drug spending increased almost 50% between 2013 and 2016 (from $22.4 billion to $33.4 billion).[2] In a survey of Medicaid programs, 36 states reported increased cost containment efforts for prescription drugs …

Happy May! In this edition of the Source Roundup, we cover four academic articles and reports from March and April. The topics this month include: 1) the unfilled promise of price transparency to encourage price shopping, 2) FDA’s actions on prescription drug prices, 3) the phenomenon of overpayment for prescription drugs, and 4) results of Maryland’s All-Payer global hospital budgeting program. Unfulfilled Promise of Price Transparency to Encourage Price ShoppingIn Promise and Reality of Price Transparency, a health policy report published by the New England Journal of Medicine, authors Ateev Mehrotra, Michael …